Monday, October 10, 2011

Current Recruiting Trends and Tips

I had a chance recently to speak with the hiring experts at Street of Walls to get a feel for current market conditions and tips on how to improve your Investment Banking Resume.

Can you discuss current hiring trends?

Hiring has been slowing at most of the large banks over the last 6 months. In fact, firings have become more of the norm. Typically during an economic expansion, investment banks increase the number of analysts as the number of deals increase. Conversely, as the economy slows, those teams shrink, which is what we are seeing today. Due to the current economic conditions such as lower trading volume and slower deal flow, large investment banks have been cutting the size of their investment banking divisions.

Recently we have been seeing massive layoffs at almost every investment bank including Goldman Sachs, Bank of America, Credit Suisse, Morgan Stanley and others.  Banks are experiencing large operating pressures from poor market conditions weighing on M&A, lower trading volumes (analysts estimating volumes down 20% this quarter), and big write-downs in investing and lending. Our sources within the banks are telling us hiring is expected to be down between 10%-20% this year, which isn’t as bad as we feared.

Will an MBA help you get a job in this environment?

We have recently seen a shift in hiring trends where investment banks are hiring equivalent talent at lower compensation levels. This has put excess pressure on recent MBA graduates. So in a sense, yes, an MBA may help you get a job but at a more junior level. Think about all of the talent that is now out there on the street. If you can hire a 3rd year associate for the same price as a newly minted MBA, why wouldn’t you? That’s the problem. Now, MBA grads are being forced to take jobs equivalent to a 2nd year analyst.

Along those lines, we are seeing mid-tier investment banks hire 1st year associates that were recently laid off from bulge bracket banks rather than an MBA candidate. These laid off banker are just glad to have a job, worrying less about overall pay as they survive the current recessionary times.

What would attract the hiring managers' attention most when reading a resume?

We break this down into 3 parts:

  1. Pedigree: School/GPA, top tier work experience
  2. Wow factor: Have you done something incredibly impressive
  3. Diversification and Differentiation: Women, international, ethnicity

The number one thing that will attract a hiring manager to a resume is pedigree. Think about how a hiring manager gets judged by their boss - you don't get fired for hiring a person who interned at Goldman Sachs, but you could get fired if the guy from the state school turns out to be a dud. If the person was good enough for Goldman, they are probably good enough for you. Of course if you have gone to a top-tier school, you should highlight that on your resume, but it probably won't help as much as solid work experience.

Wow Factor:

Do something to really impress the recruiters and this can supersede a less than top-notch pedigree. A “wow factor” can be something like starting and growing a company with multiple employees selling products or services in multiple states. This example shows a person who can manage personalities by dealing with employees, and a person who is an extreme multitasker.

Diversification and Differentiation:

Be different, don't be a boiler plate. Highlight anything that will make someone remember you.  For example, not many people take the time to give back to the community. If you started/ran a charity or are a frequent volunteer make it known that you are significant contributor. I have interviewed over 1,000 people in the past 3 years and I still remember one candidate who put on his resume that he played golf in Antarctica. In reality he was on a submarine in the navy and they only briefly surfaced in Antarctica, but I still remember the example today.